My Turn: Don't let Legislature fool Alaskans again

In the Superman comic books of my youth, “Bizarro World” was a parallel universe where everyday was Opposite Day. Up meant down, bad meant good, the world was a cube, and Bizarro Superman and Bizarro Lois Lane looked like the Addams Family on a bad hair day.

In the Bizarro World that is the Alaska Legislature, we find ourselves in a situation where the only right vote on a minimum wage bill introduced by the House Majority late in the session is “No.”

Even to those accustomed to cynicism and insincerity in the Legislature, the sudden interest in passing a minimum wage law that would preempt the voter initiative is breathtaking for the contempt and disrespect it demonstrates for the intelligence of Alaskan voters. Protestations by House Majority Leader Lance Pruitt notwithstanding, his majority would pass a bill identical to the initiative for only two reasons, neither having anything to do with the best interests of Alaska workers. The first would be to avoid bringing out low-income voters who might not vote as the Majority would prefer in statewide races or on other ballot measures. The second is to come back next year and repeal key provisions of the law before they take effect, as was done in 2003.

In 2001, bills to increase the minimum wage and index it to inflation were stalled in the legislature. The AFL-CIO gathered 50,000 signatures for an initiative mirroring Gov. Tony Knowles’ bill, which was approved for the November 2002 ballot. As with the current initiative, polls showed 70 percent support for the measure. After trying to move a bill without indexing, which they were advised would not meet the test of “substantially similar” legislation required to block the vote, the Legislature passed a bill identical to the initiative and sponsored by House Speaker Pete Kott, in May 2002.

Kott was asked if the bill had been passed only to keep the initiative off the ballot and curb turnout by low-income voters who might lean Democratic. Here’s what he told the Associated Press on May 16, 2002:

“Rep. Pete Kott, R-Eagle River, has said that was not his motivation for sponsoring the bill. Kott had proposed a smaller increase in 2001 but changed his bill to match the ballot initiative. He has said it is better for the Legislature to address the measure than leave it to voters. That way, if legislators decide to change the inflation provision, they can do so next year, Kott said. If the change were made through a ballot initiative, they’d have to wait two years.”

Kott knew what he was doing and, in this case, was true to his word. In May 2003, the Legislature repealed the indexing provision in a bill signed by Frank Murkowski. Seventeen Majority legislators who had voted for the bill in 2002 voted to gut it in 2003.

Had they left the indexing provision in place, Alaska’s minimum wage would be $9.53 today, rather than $7.75, a huge difference in the lives of thousands of hardworking Alaskans.

A move is afoot to pull the same cynical stunt this year, preempting the minimum wage initiative already approved for the August ballot as Ballot Measure 3. While House Majority Leader Lance Pruitt claims it is wrong to assume history will repeat itself, representatives of the hospitality industry work the halls with a top lobbyist seeking support for legislation to do just that. Is Pruitt really unaware that one in four current Republican legislators voted to gut the 2002 bill in 2003? He is being disingenuous, at best, when he dismisses valid concerns of initiative supporters. A young man with likely statewide ambitions, he should consider finding a better role model than Pete Kott.

If a minimum wage bill is introduced, Alaskans need to let legislators know we won’t be fooled again. They should stop playing games and insulting our intelligence, and let the people vote on the initiative. At least the Majority would then have to wait two years to thwart the will of the people.

• Ed Flanagan is chair of Alaskans for a Fair Minimum Wage and served as the labor commissioner under Gov. Knowles from Jan. 1999- Dec. 2002.

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There seems to be a prevailing thought that adding a buck or two to the minimum wage will bring immediate prosperity. Minimum wage is not a living wage nor was it ever intended to be. It does prevent abuse of those entering the workforce for the first time and ready to work their way up. Raising the minimum wage will lead to higher prices, increased automation, and reduction in workforce hours. Don't worry about votes for the Democrats, they will get plenty with the increased government dependence they create.

The old mistake about cause and effect can be expected from some legislators IF they again pull off this cruel stunt. It's about "the job creators," they will say, and how tying the minimum wage to inflation is "a job killer." Wrong.

Let's go back to ECON 101 and its basic building blocks of "supply" and "demand." Where does the supply come from? Those who produce goods and services. And where does the "demand" for "supply" come from? Those with enough money in their pocket to purchase the goods and services. And who are these? Consumers, the true job creators.

An employer hires an employee but not before there is something for the employee to do. What causes the employer to hire is "demand." And there isn't any demand unless consumers have sufficient money to spend for an employer's supply. If consumers have enough money above what it costs to live, they will tend to consume more: go out to dinner, buy a book, purchase new carpet ... on and on.

What increasing the minimum wage and tying it to the rate of inflation does is give people the minimum (and often less than that) to sustain basic needs, and still, an elevated minimum wage leaves them in poverty.

But here's the thing: the additional money from an increased minimum wage will be spent immediately, which increases demand from consumers for supply, thus sustaining and creating jobs.

Mr. Flanagan points to how a previously accomplished legislative trick actually reduced the minimum wage in Alaska and how legislators might try to play the same game again, and that they should not "game" Alaska voters again. Agreed! To do so is unjust, cruel, wrong.... Additionally, this comment points to how IF the game is played again, employers everywhere will be hurt in the long run because a frozen minimum wage is a job killer and will hurt (and hurt cruelly) job creators--in this case, the many minimum wage earners who help to create demand.

If a higher minimum wage is a good thing which increases prosperity why not a minimum wage of $25 an hour? Most would say this is too high. What would be the optimum level of minimum wage?
The increase in the minimum wage will increase the cost of some services and goods or employers will demand greater productivity from their workers. If a fewer number of workers are more productive there will be a less people employed and more people unemployed.
On the issue of supply and demand-- If the supply of labor is at a level where people will work for the current minimum wage isn't this the proper pay level? If there are not enough people willing to work for this pay level won't employers be forced to pay people more or change their methods of production? Wouldn't this be the most efficient level of establishing wages? Although this theory has a problem when government provides programs which allow a person to have food, housing and medical care without personal efforts.